Wednesday , July 24 2024

There is a growing tendency among institutional investors to book profits through block deals

Mumbai: As the stock market continues to rally, institutional investors are seen booking more and more profits, especially through block deals. According to a research firm report, a total of 392 block deals worth Rs 86,036 crore were done in the first five months of the current year.

There were 226 block deals worth Rs 54351 crore in the last five months of 2023. Compared to the first five months of 2023, the first five months of 2024 have seen a sharp increase in block deals.

In the first five months of last year, 102 block deals worth Rs 27,840 crore were done.

Block deals are generally considered an appropriate measure to know the true value of an equity. Taking advantage of the recent rally in Indian equities, private equity investors are booking profits through block deals. After booking profits on earlier investments, private equity players are reinvesting in equities that have scope for growth, the report said.

Recently, investors' attraction towards small and midcaps has increased significantly. This is also one of the reasons for the increase in block deals.

Since the shares of many companies are not particularly liquid, it is preferred to sell or buy them through block deals. The current year has started strong in terms of block deals. The report also states that January saw 231 deals, while the number of deals in this month of 2023 was only 21.